Amazon's Quarterly Revenue Is Up 34 Percent Following Whole Foods Acquisition
Amazon sales increased by 34 percent during the third quarter to $43.7 billion, the e-commerce giant reported Thursday.
Investors, who had been expecting quarterly revenue of $42.1 billion, responded favorably to the gains, boosting the stock by more than 7 percent during after-hours trading on the Nasdaq.
The Seattle company's revenue gains were thanks in part to its $13.7 billion acquisition of Whole Foods, which brought in $1.3 billion in sales during the three-month period. But excluding Whole Foods and favorable foreign exchange rates, revenue is still up 29 percent year-over-year.
Amazon also reported net income of 52 cents per share, even with the same period in 2016. Wall Street had been expecting a down period for Amazon, with analysts polled by Thomson Reuters looking for net income of 3 cents per share. After years of losses, this is Amazon's 10th straight quarter reporting net income.
The strong quarter comes amid a period of turmoil at Amazon's Hollywood outpost, Amazon Studios. Programming chief Roy Price resigned earlier this month following allegations of sexual harassment, leading to a string of departures including comedy and drama head Joe Lewis (who now has a producing deal with Amazon), international chief Morgan Wandell (for a plum job at Apple) and unscripted head Conrad Riggs. Amazon Studios chief operating officer Albert Chang, who has taken the reins on an interim basis, has promoted Sharon Tal Yguado to lead all scripted and Heather Schuster to lead unscripted.
Asked about the turnover during a call with investors, CFO Brian Olsavsky did not specifically address the personnel changes, instead focusing on the importance of video to Amazon Prime. "We're going to continue to invest in video and increase that investment in 2018," he said, rattling off ways that video has improved Prime.
He also fielded a question about whether advertising would become a bigger part of the Prime Video experience, noting that customers who have paid for Prime can expect to "enjoy it without interruption."
In addition to acquiring Whole Foods during the third quarter, Amazon also began streaming Thursday Night Football live on Amazon Prime. Amazon said that the first four videos have garnered 7.1 million views in 187 countries. They have been watching the games for an average of 51 minutes.
The company has also begun a search for a second North American headquarters, for which it has received 238 proposals.
Amazon stock closed the day even at $972.43. After hours, shares were trading up more than $62 to over $1,030.